Wednesday, April 27, 2016

California leads the nation in electric vehicles, with nearly 200,000 on the road -- half the total in the United States. But Northern California only has about 5,000 charging stations, so EV owners are suffering from what's known as "range anxiety."

The California Public Utilities Commission needs to encourage a competitive market as the state develops a network of charging stations. That means making room for different operators, even if a monopoly system could be more quickly established and, initially at least, no more expensive.

The PUC has approved pilot programs by San Diego Gas and Electric and Southern California Edison for EV charging stations in the San Diego and Los Angeles areas that allow for competition from the start. PG&E's proposal for North and Central California is the topic of hearings this week, but the PUC should reject the plan -- even if it means further delays in building out this region's network. Approving it could give the utility a virtual monopoly in this major new energy market.

PG&E, to its credit, wants to ramp up the service as quickly as possible to help meet Gov. Jerry Brown's goal of 1 million electric vehicles on California roads by 2020. Its initial proposal was for 25,000 stations, with ratepayers footing most of the $654 million bill, including maintenance costs.

The PUC said it didn't have the means to evaluate potential consequences of PG&E's

large-scale plan and asked for a more limited pilot proposal. The current one is for a three-year, 7,500-station plan that would cost ratepayers an estimated $200 million. It includes good ideas, such as placing 15 percent of the stations in low-income neighborhoods and making a priority of fast-charging stations -- getting EVs to 80 percent of capacity in 20 minutes -- along major highways.

But PG&E wants to own and maintain its charging stations, reducing the potential for private companies to find innovative ways of serving EV customers.

To compare -- Southern California Edison ratepayers also will pay the initial costs for the network but not maintenance, which would be passed on to customers. Its pilot for 1,500 stations could be expanded to 30,000 stations by 2020 if it's successful. The key difference, however, is that it would allow site hosts the ability to set prices for their charging stations, encouraging innovation that could save consumers money or add services.

More than 100,000 charging stations will be needed to serve electric vehicle owners in PG&E's service area. The PUC could decide that the monopoly plan is in the best interests of California to kick start the network. But just as gas stations compete for motorists' business, private charging station operators might offer different services at different prices or develop improved technology to bring prices down.

Quick-starting a network will be unwise if it limits competition in the long run.